CVS boosts outlook as Aetna takeover bears fruit
'We are confident that we’re on the right path'
CVS CEO Larry Merlo discusses his company's efforts to buoy health care transparency.
CVS Health reported strong fourth-quarter results and raised its 2020 outlook, citing the successful integration of its Aetna purchase.
The Woonsocket, Rhode Island-based pharmacy chain reported a fourth-quarter profit of $1.74 billion, or $1.33 a share, as revenue rose 23% to $66.9 billion. Adjusted earnings of $1.73 a share topped the $1.68 average estimate from analysts, and shares rallied.
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For the full year, CVS earned $6.63 billion on revenue of $256.8 billion.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| CVS | CVS HEALTH CORP. | 76.75 | +1.75 | +2.33% |
“As a result of the significant progress we made in 2019, and meeting or exceeding our expectations for the year," the company expects 2020 profit of as much as $7.17 a share, CEO Larry Merlo said in a statement. "We are confident that we’re on the right path to delivering significant value."
That guidance topped the $7.15 average estimate from analysts surveyed by Refinitiv.
Sales from CVS' health insurance unit surged 175 percent in the fourth quarter to $17.15 billion, boosted by the company's $69 billion acquisition of Aetna, which was completed in November 2018. Revenue from the pharmacy chain's retail unit climbed 2.5 percent to $22.58 billion
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CVS shares fell 0.6% this year through Tuesday, lagging the S&P 500's 3.9% gain.